Iowa AG announces propane pricing deal

DES MOINES, Iowa - DES MOINES, Iowa (AP) - Iowa Attorney General Tom Miller announced an agreement Thursday with a major supplier of liquid propane gas that requires the company to provide customers with an easily understood summary sheet that explains pricing and charges.

Under the agreement with Overland Park, Kan.-based Ferrellgas, the company must provide information about pricing, including surcharges and fees, and tell customers what they're being charged per gallon. Ferrellgas is the largest distributor of liquid propane gas in Iowa.

The deal comes after years of complaints from Ferrellgas customers who said a complicated pricing structure made it nearly impossible to understand their heating bills. Propane is used to heat homes in many rural areas that aren't connected to natural gas lines, and farmers rely on the fuel for drying corn after the fall harvest.

"This agreement should minimize confusion for Ferrellgas customers across Iowa," Miller said at a news conference. "Customers will know up front what they will be paying for the propane that heats their homes."

Miller said his office worked with Ferrellgas after receiving complaints to the agency's consumer protection division.

"Because of Iowa consumers who contacted us with concerns we asked the company to more clearly and openly disclose its pricing structure and the company agreed," Miller said.

The agreement was signed Wednesday and goes into force on Jan. 1, 2011. The company has agreed to reimburse the state $25,000 to cover the costs associated with the case, Miller said. Miller credited the company for working with the state in resolving the issue.

Ferrellgas spokesman Scott Brockelmeyer said the company was happy to work with Miller.

"We believe the agreement is a positive step for propane retailers and propane consumers," Brockelmeyer said.

Miller said other propane distributors likely will follow suit and simplify billing.

"I intend to approach other propane retailers doing business in Iowa about simplifying pricing," Miller said. "Good companies that deliver propane to heat Iowans' homes should not have a problem delivering their customers easy-to-understand bills."